Consoles will be niche, says EA founder

Trip Hawkins thinks the hardcore will become a hobby market as industry expands

The gaming audience is growing every day, but Trip Hawkins thinks the console market is headed in the opposite direction. In an interview with IGN, the Electronic Arts founder and former Digital Chocolate CEO said consoles are shrinking as gaming becomes a mass market endeavor.

"The console market is always going to be with us, because there's always going to be a hardcore segment, a segment that likes innovation," Hawkins said. "But it's going to become a smaller market, and it's going to be more like a hobby market. You look at airplanes. Most of us just want to be a passenger, but there's a hobby market for people who are really into aviation and want to take flying lessons and maybe someday have their own airplane. I think that's what's happening to the console market."

Meanwhile, Hawkins said the total size of the gamer audience is stretching into the billions with the help of PCs, phones, and tablets. One of the big advantages that Hawkins sees with new platforms is that their browser- and cloud-based offerings let people play the same games wherever and whenever they have free time.

"In the old days I'd go down to the basement to play Grand Theft Auto," Hawkins said. "But the Facebook gamer is able to play at work, at home, in a hotel on a PC. They can get access to a browser just about anywhere. People are thinking about convenience first."

Hawkins is targeting that larger audience in his current work with Extreme Reality. The firm makes software that allows 2D cameras to act as motion-control devices.

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As I say every time I see this kind of article : Publisher try to push for this, but it's not true. Gamers won't change to low quality facebook games and free-to-play with paid content. In 5 years when every big corporation changed to this business model, they will see it was the worst idea they ever had.

If we speak about market size, it's true that consoles are less attractive than smartphones etc. However, I don't know any players who would like to play an assassin's creed, or a Battlefield game on an iPhone... This is as simple as that.
Even if phones' screens are bigger and bigger year after year, this market is more attractive only because people play games on their phones. And if studios and publishers starts to make hardcore games a hobby, they're just going to kill video games. Actually, casual games are attractive to business people, but to players it is just a step back.

Statements like this are pretty telling of how game publishers view the future of their medium. It's not good enough anymore to develop a handful of quality video games for the consoles and PCs in which hardcore gamers invest. Now, they push developers to create hackneyed time-wasters, so they can be pushed out onto tablets, smartphones and web browsers on the expectations that someone is going to get bored enough one evening to download one and play for a while. They're treating games like the beef jerky a convenience store clerk tries to sell you while you pay for your gas.

But yeah, we're definitely in the "penny dreadful" phase of gaming and at the current rate of devaluation, gamification and monetization, I suppose it could come to a point where you end up with a total division between "hardcore" gamers and purely casual ones primarily based on assorted misconceptions.

Not every mobile game I've played is dreck, but it also seems that "popular" automatically equals "good" as far as certain genres or styles of gameplay go. Of course, the same thing is true for consoles and handhelds, but it seems that both camps have their share of die-hard defenders when it comes to this.

Relatively speaking, just based on user numbers, console gaming is already a niche.... However, a userbase niche of the order of 60 million (PS3+360 - not thinking about Wii for the time being) is pretty good to sustain some sort of an industry!

@Bruce: And that is why, after 8 years, the 360 still sells around 270k unit per month only in US, right? Consoles can change their selling model if necessary, you know?. One thing is believing that they are going to disappear, another thing is wishing for that.

In my opinion Core gamer are already a minority compared to casual gamers. The difference is that a casual gamer maybe gets one game each two months, maybe less. And focus in f2p games in which they expend money in some cases. Hardcore gamers spend more time and money in games and tend to focus in just one f2p game, but generally using more money on it.

Both sectors are going to stay, for some time at least no doubt about that.

@Bruce: so was the "limited" success of the NES, SNES, PSX and PS2 also as a multimedia device? What about the Wii?

Now I do expect some changes, because so many changes are possible and would make things better, but what exactly those changes will be we will have to see. There are many questions at play, what landscape do we wish to create? what type of economy do we want? what customers will be served?

Let's imagine that there were no more new console games, will people just carry on playing the same versions of COD and FIFA? If we can't answer those questions we will not be able to answer anything more complicated like the apocalypse that is being prophesied far too often by the social and mobile gaming sector.

Yes, there are big numbers over there, but only the simpleton would ignore the great gains that were already being made. You will not see thousands of Angry Birds released every year, so let's stop bring them up. In fact let's just point out that it's technically impossible for Angry Birds to be the norm, there's just not that much money in the world. If the future of mobile gaming is going to be Angry Birds and FarmVille, such that one or two companies make all the money, then that's just not sustainable is it?. And look at what they're doing with their riches? copying others, stealing, cheating contractors, shutting down entire divisions and losing their own identity in chasing tail. I fail to see that as the most conducive future for the industry.

As for Rovio, given the amount of money they have, look at how many games they've produced with that. I'm not insulting them, just raising the point that with that money we could have had countless high quality games with a great level of depth, with productions that look and feel like a hundred million dollars. We could have had the next instalment of the Matrix, the sequel to the Terminator, GTA6 and several sitcoms , but no, we get 'Amazing Alex' and worse for Zynga, 'The Ville' given the fact that they could have funded all of the above. They may have 'talent', but what's the best jockey to do on a crippled horse that can't turn left?

Edited 2 times. Last edit by Keldon Alleyne on 15th October 2012 11:12am

Having worked on console games for many years I would say the best gaming experiences are still to be found there for now. That's just not negotiable. The hardware is designed solely for that purpose. However, technology changes. Technology that we currently call unusable for these types of experiences can become as capable with some pretty simple changes (a device controller). Processing power isn't really something to care about these days. All devices are fast enough to run a decent game. Once the control method gets solved for the other eco-systems outside of what we refer to as "consoles", and that eco-system moves into the living room then you will probably have no reason to separate and compare the two really. You will only compare the game content itself and the OS on which it exists. Its all ideas at the end of the day, and the best ideas win, whatever device they are played on. If you are making games you should be thinking about being device agnostic in the future in my opinion. You want to make your game available to as many people as possible what ever device they own. A game of the future for me shouldn't really care which piece of hardware its getting played on. It should work across the board like a movie or music file.

Edited 1 times. Last edit by Sandy Lobban on 15th October 2012 11:43am

I'm not Trip Hawkins and I don't really like to predict what will happen next. However, if becoming a hobby market means possibly going back into time when console gaming wasn't as mainstream as it is today where fresh new ideas were being created, then I welcome it!

I don't doubt the console market will constitute a (proportionally) smaller section of the games industry going forward. There are too many different forms of gaming available, expanding at too fast a rate, for this not to be the case.

But does this exclude console gaming from growing further? Does this automatically make console gaming niche? Does it stop the movement of console gaming to becoming increasingly mainstream, as it has done since the NES, through the PlayStation, through to Wii? Those questions are far more difficult to answer. I believe the console industry will continue to grow, but to what extent is uncertain. Whether it will break out further into the mainstream is another, bigger unknown. If console gaming can attract a portion of the ever expanding, huge (as we are so often reminded) mobile and tablet market, then it could potentially bring in tens of millions of gamers that have never used consoles before. Will the console market be a niche market? It might be, but it could still easily (and almost certainly will be, in terms of revenue per user) the most profitable and lucrative sector of the market, particularly if the console manufacturers continue to make progress with digital business models.

I don't know if 'niche' is the correct term, really. We're currently looking at 7th generation figures of 200 million (and growing) home console users, and 220 million handheld console users. The handheld figure won't be reached by consoles in the coming cycle, but eighth generation home consoles are a different bet entirely, and could well expand again. I for one, certainly hope they do.

@Daniel Hughes
HD Consoles (the ones "core" gamers use) Xbox 360 69 million PS3 68 million. Total 137 million. After 7 years.
New Android devices registered every day 1.3 million. And rising exponentially.
That is about 20 times the sales rate. But it will rise till there are 7 thousand million smartphones in use on planet earth. Compared with that consoles are a small niche.

Phones are primarily communication devices: talk, text, e-mail, social network. Games consoles are still primarily games devices. If we really wanted to establish how niche the console market is, or even if it is a niche sector of the games industry, we can't just take raw smartphone sales and ignore 95 million sales of the Wii. I'm more than happy to debate these issues, but when you skew the matter that far in your favour, it's a little ridiculous, Bruce. Even if Wii has a 'casual' reputation (I own a Wii and over 60 retail and digital games for it, is that 'casual'? Absurd labels, really), we can't preclude it from console sales. It is still a dedicated gaming device released within the last 7 years, and its sales should be right there along side PS3 and Xbox 360.

So that's 232 million home consoles in 7 years. And yes, even versus that figure, smartphones come out way on top. As you would expect them too: communications devices are much more a part of societies around the globe than dedicated videogames machines are, and smartphones are on sale in many more markets than videogames consoles. It's clear we can't compare the install bases from two different industries, instead we should be comparing the point these industries overlap, the point where smartphone users become gamers. Where are the figures for that? How much higher is that than 200 million? How many games per user? How much revenue per user? How much time gaming per user? How do these factors compare against their respective states in the console market? How high is the penetration rate in markets console gaming has most established itself? How big is the overlap between mobile gamers and console gamers?

That's the research that should be conducted and used to draw conclusions. If console gaming remains the domain where the most money is made, if console install bases can grow and take advantage of digital models in the years to come, then the console industry can grow and there is every chance it will become more mainstream as smartphones and tablet increase the game playing population. It's not so clear cut as x amount of Android devices per day, therefore consoles have become and are condemned to remain a small niche. The truth is far more complex and fascinating than that.

+ Dan Adding onto that, it would be truly useful to find out how many folks download a game on their smartphone, and the frequency of play/use. its often very easy to download cheap/free games but barely touch it with a bargepole for years and years on end (because maybe it didn't cost much or was free, its like hoarding)

Its ironic, considering that the consoles were always a niche market. And as usual, niche markets are used to be more profitable. What the iPhone's success really showed that there is business to be made outside of a strict control of a giant corporate. If Apple choose to levy the same burden on developers as Microsoft, Sony and Nintendo does, we would probably not argue about this as these fascinating growth would very likely not affect us, game developers. Not yet, at least.

Tom, am I reading that chart correctly when it says that in 2011, only 22% of iOS users actually used an app they downloaded? Or is it saying that of the apps they downloaded, 22% of them only used it once and never again?

Either way, I think that shines a huge light onto the difference in console and mobile gaming. Very, very few consoles games are only ever played once and then never again. And even fewer would buy 4 or 5 games and only ever play 1 of them.

If I buy a book full price, chances are I will read it as soon as possible, but I have books that cost a quid from a charity shop that I have had unread for years. And whilst if I pay £40 for a game it is likely to get a reasonable amount of play unless it is bad, I have games from Steam sales, Humble bundles and Game clearance shelves I mean to play, but don't get round to. So the fact that a lot of free or cheap apps are used once or not at all comes as no surprise to me.